Amer. Airlines v. Allied Pilots Ass'n

• Decision Date: 21 September 2000
• Docket Number: No. 99-10814,99-10814
• Citation: 228 F.3d 574
• Parties: (5th Cir. 2000) AMERICAN AIRLINES, INC., Plaintiff-Appellee, v. ALLIED PILOTS ASSOCIATION, RICHARD T. LAVOY, and BRIAN A. MAYHEW, Defendants-Appellants
• Court: U.S. Court of Appeals — Fifth Circuit

Page 574

228 F.3d 574 (5th Cir. 2000)

AMERICAN AIRLINES, INC., Plaintiff-Appellee, v. ALLIED PILOTS ASSOCIATION, RICHARD T. LAVOY, and BRIAN A. MAYHEW, Defendants-Appellants.

No. 99-10814

UNITED STATES COURT OF APPEALS FOR THE FIFTH CIRCUIT

September 21, 2000

REVISED - SEPTEMBER 22, 2000

[Copyrighted Material Omitted]

Appeal from the United States District Court for the Northern District of Texas

Before WIENER, BENAVIDES and PARKER, Circuit Judges.

ROBERT M. PARKER, Circuit Judge:

Defendants-Appellants, Allied Pilots Association ("APA") and two of its officers, appeal an adjudication of civil contempt against them and an award of compensatory damages for that contempt. The district court awarded approximately $45.5 million dollars in compensatory damages after finding that defendants failed to carry out a temporary restraining order mandating that they call off a "sick out" by the pilot members of the APA. Defendants contest the evidence and the due process given in the district court's contempt and damage rulings and also argue that any award of compensatory damages is inconsistent with the Railway Labor Act.

FACTUAL HISTORY AND PROCEEDINGS BELOW¹

This saga began with American Airlines's ("American") acquisition of Reno Air, Inc. in December of 1998. Following the acquisition, American advised the APA that it intended to operate Reno Air separately for a transitional period due to legal, operational and business constraints that prevented instantaneous integration.² The APA, which is certified under the Railway Labor Act³ to represent approximately 9,300 pilots employed by American, took the position that the newly-affiliated Reno Air flights should be flown in accordance with the existing Collective Bargaining Agreement ("CBA") between American and the APA. Specifically, the APA argued that American's operation of Reno Air with pilots not on American's Pilot Seniority List was in violation of the Recognition and Scope Clause of Section 1 of the CBA.⁴ American refused to apply the CBA to the new affiliate. The APA contended that American's operation of Reno Air outside the CBA constituted a unilateral amendment to the CBA which, under the RLA, justifies self-help measures such as a strike or other job action. American took the position that the CBA did not immediately oblige it to apply its terms to Reno Air and that because the dispute with the APA involved contract interpretation,⁵ it was a "minor" dispute under the RLA, thereby making unlawful any self-help action by the APA.

American and the APA negotiated for approximately two months without resolution. On February 5, 1999, a large number of the APA's pilot members began an unannounced sick-out. This illegal job action⁶ resulted in an enormous number of flight cancellations due to lack of crew, which, in turn, cost American millions of dollars in lost revenues and affected hundreds of thousands of passengers throughout the country.

The sick-out began on February 6, 1999. From that day until February 9, 1999, over 1600 flights were canceled because of lack of crew. On February 10, 1999, American sought relief from the district court in the form of a Temporary Restraining Order ("TRO"). At 4:00 p.m. (CST) on February 10 the district court signed the TRO. The TRO required the defendants and anyone working for or with them to take "all reasonable steps within their power" to prevent continuation or encouragement of the sick-out. The TRO also contained specific requirements: that the defendants "instruct all pilots to resume their normal working schedule," that the defendants notify all APA-represented pilots by the "most expeditious means possible" of the contents and meaning of the TRO, that the latter communication contain a directive "to cease and desist" the sick-out, that the communication be posted on the APA's web site, that the contents of the TRO ordering paragraphs be included on all telephone hotlines held by the APA, that the defendants report by noon on February 12, 1999, the methods used to effect the notice required by the TRO, and that copies of the notice and reports be furnished to American.

The district court found that the sick-out actually increased in size after the TRO was signed. On February 11, 1999, the day after the TRO was signed, over 1200 flights were canceled. That same day, American sought to hold the defendants in civil contempt for violating the TRO. After hearing evidence on American's contempt motion on February 12, 1999, the district court issued an Order of Contempt⁷ in which the defendants were adjudged to be in civil contempt. In addition, a date was set for a hearing on the issue of compensatory damages for February 17, 1999.

At the February 17, 1999 hearing, American presented evidence regarding the amount of damages it suffered as a result of the defendants' contemptuous conduct. The defendants did not present evidence, but moved for a continuance which the district granted.

The hearing on damages reconvened on April 12, 1999, and was further continued until April 15, 1999. At the conclusion of the hearing, the district court announced its decision from the bench to award $45,507,280.00 in compensatory damages attributable to the defendants' conduct.

STANDARD OF REVIEW

We review contempt findings and damage awards for contempt for abuse of discretion. See Martin v. Trinity Indus., Inc., 959 F.2d 45, 46 (5th Cir. 1992); see also Crowe v. Smith, 151 F.3d 217, 226 (5th Cir. 1998) (noting that "review is not perfunctory" where "a district court's imposition of sanctions under its inherent power is involved"). The district court's underlying findings of fact are reviewed for clear error and its underlying conclusions of law reviewed de novo. See Petroleos Mexicanos v. Crawford Enterprises, Inc., 826 F.2d 392, 401 (5th Cir. 1987) (citing Anderson v. City of Bessemer City, 470 U.S. 564, 572 (1985)).

DISCUSSION

I. Liability for Civil Contempt.

A. The District Court's Order.

To support a contempt finding in the context of a TRO, the order must delineate "definite and specific" mandates that the defendants violated. See Fed. R. Civ. P. 65; Travelhost, Inc. v. Blandford, 68 F.3d 958, 961 (5th Cir. 1995). "An injunction must simply be framed so that those enjoined will know what conduct the court has prohibited." Meyer v. Brown & Root Const. Co., 661 F.2d 369, 373 (5th Cir. 1981). The district court need not anticipate every action to be taken in response to its order, nor spell out in detail the means in which its order must be effectuated. See North Alamo Water Supply Corp. v. City of San Juan, 90 F.3d 910, 917 (5th Cir. 1996) ("Although this order does not choreograph every step, leap, turn, and bow of the transition ballet, it specifies the end results expected and allows the parties the flexibility to accomplish those results.").

The district court's TRO contained the following provisions:

IT IS ORDERED, that the Defendants, and each of them, their agents, successors, deputies, servants and employees, and all persons acting by, in concert with, through or under them, or by and through their orders, are hereby temporarily restrained pending a hearing on the preliminary injunction in this matter:

(a) From calling, permitting, instigating, authorizing, encouraging, participating in, approving or continuing any interference with American's airline operations, including but not limited to any strike, work stoppage, sick-out, slowdown or other concerted refusals to fly over a minor dispute or otherwise in violation of the RLA, 45 U.S.C., §§ 151-88 (1988).

AND IT IS FURTHER ORDERED:

(b) That the said Defendants and said other persons acting in concert with them shall take all reasonable steps within their power to prevent the aforesaid actions, and to refrain from continuing the aforesaid actions if commenced.

(c) That the said Defendants shall instruct all pilots to resume their normal working schedule, and provide Plaintiff a copy of all such instructions.

(d) That APA and the individually named Defendants notify, by the most expeditious means possible, all APA-represented pilots employed by American of the issuance, contents and meaning of this Temporary Restraining Order, and produce a copy of all such messages to Plaintiff.

(e) That the notice described in (d) above include a directive from APA to those pilots who are engaging in a sick-out or other concerted refusals to fly to cease and desist all such activity and to cease and desist all exhortations or communications encouraging same.

(f) That APA and the individually named Defendants post the notice described in (d) above to APA's Internet web site, and provide a copy of the notice to the Plaintiff.

(g) That APA and the individually named Defendants include the contents of the ordering paragraphs of this Order on all recorded telephone hotlines under control of Defendants or any of them, until such time as the Court has acted on Plaintiff's Motion for a Preliminary Injunction, and provide a copy of all messages to the Plaintiff.

(h) That APA and the individually named Defendants report by February 12, 1999, by sworn affidavit, the methods used to effect the notice described in (d) above to all APA-represented pilots.

(I) All copies required to be furnished to the Plaintiff by Defendants under this Order shall also be contemporaneously furnished to the Court.

Defendants argue that all of the specific requirements of the TRO were met. Our examination of this issue focuses on whether the general provisions of the TRO were sufficiently clear in what conduct they mandated and prohibited to support the contempt finding.

B. The Defendants' Efforts to Comply with the TRO.

According to the defendants' brief, LaVoy appeared before television cameras immediately after the TRO was issued saying that the APA would comply with the district court's order and asking APA members to return to work. The evening of February 10, LaVoy and Mayhew...